US sanctions hurt Russian company’s microchip advances: report

U.S. sanctions targeting Russian tech businesses have delayed a Russian microchip company’s efforts to replace Western products with Russian-made goods, according to Reuters.

The sanctions, which stem from Russia’s internationally unrecognized annexation of Crimea and support for separatist rebels in Eastern Ukraine, have frustrated Russian President Vladimir Putin’s desire to make Russian tech less dependent on Western parts, the news agency reported.

{mosads} Angstrem-T, which makes semi-conductors and bought a license from IBM to produce microchips before the sanctions took hold, failed to reimburse a nearly $1 billion loan and is set to be taken over by state development bank VEB, Leonid Reiman, chairman of the company’s board of directors, told Reuters. 

He added that the company’s inability to pay back the loan was partially due to the sanctions, which forbid Angstrem-T from doing business with U.S. firms.

“Although we initially received the (U.S.) State Department’s consent for this project and the delivery of the technology here, the sanctions caused the deadlines for its completion to be drawn out,” Reiman told Reuters.

“The factory is working, the products are being produced, but the question of procurement remains,” he added.

A microelectronics expert in Russia told Reuters the delays in the project had caused Angstrem-T’s products to become outdated.

While President Trump in the past has suggested that he would recognize Moscow’s annexation of Crimea, he told reporters in July, “We haven’t taken off the sanctions, the sanctions are biting.”